Choosing an education loan could easily be one of the most important things a person does and therefore it is vital to get it right. However, the basics are fairly simple and this article will take a look at what needs to be discussed before the correct educational loan can be chosen.The first type of loan to take a look at is the federal education loan, and these have the advantage that they are usually of a fairly low interest rate and come with conditions which enables the student to take almost any kind of education he or she pleases. Due to the fact that they are from the federal government, they are highly regulated and give the student a great deal of security when they are carrying out their education.On the other hand many students go to private loans in order to fund the education, and although these can be a good way of funding education it does have to be borne in mind that the interest rates can be much higher than those that come with federal education loans. However, they can be used to add to a federal loan and so therefore may not be such a debt burden.The other type of student loan that needs to be considered is what can be called the consolidation loan, which enables the student to take several loans, sometimes all of them federal loans, and consolidate them into a single load. This makes the interest payments smaller in many cases, and also enables students to keep control of the finances to a great degree.Keep these three points in mind and it should be much easier to find a student loan to suit your needs.
So you have taken a state college loan to finance your college education. Now, you are planning to consolidate the same so that you can reap the benefits of consolidation. Before going in for consolidation of your state college loan, it is imperative that you understand the various aspects of consolidation.You can exercise a choice in the type of loan for consolidation. It may be a federal loan or a state loan that can be consolidated. Each has it’s own advantages and disadvantages. In the situation of you possessing both federal and private loans, do not consolidate them together. This is because various benefits of federal loans may be lost if you consolidate it along with private loans.Federal Loan Consolidation ProgramThe Federal Loan Consolidation Program can handle state college consolidation loans. The main advantages of Federal Loan Consolidation Program are as follows:- Federal Loan Consolidation Programs charge no fees, which is very advantageous for the students.- This program does not ask for either any co-signer or co-borrower or for any credit checking.- There are various types of repayment options available.- There is the added benefit of forbearance and deferment.- The government backs these loans.- The government will make sure the loans are repaid in some way.- In case of default of repayment, either your salary is garnished or your income-tax is seized.Private State College Consolidation LoansThere is a huge competition in trying to secure a private state college consolidation loan. Still, it is not so very difficult to secure a private state college consolidation loan. A credit check is very vital to secure a loan of this type. Some of them may even ask for a co-signer or co-borrower to sign in the loan agreement guaranteeing that the loan will be definitely repaid. There are also cases when relief is given to a co-borrower on a time loan payment, after a specific period.Before the co-signer signs on the agreement, the credit worthiness of the co-signer will be checked. It is very advantageous when you have a co-signer as you can demand lower interest rates as you are considered credit worthy and reliable.A co-borrower has to satisfy the following conditions before he can proclaim himself as a co-borrower:- Only US citizens with a Social Security Number and US mailing address can be co-borrowers.- They have to be permanent residents too.- They have to be of legal age of above 18 years.- They must be reliable and have an excellent credit history.- They must not have been bankrupt for the last seven years.- In their history, there should be no case of student loan default.- They must be freely willing and capable of signing the legal documents.
When it comes to debt consolidation, many Americans are in the dark. The extent of their knowledge is that debt consolidation is often utilized by people who have bad credit and are seeking a way to get out their debt. However, consolidation loans, debt management, and credit counseling often go together as a means to educate people against poor financial decisions to help them avoid being stuck in the same financial situation in the future.Loans consolidation and debt relief are offered by thousands of companies across the nation. These companies make their money from consolidating loans for people with debt and then taking a portion of the payment the person makes toward their consolidation. While this is a pretty standard business practice, some companies take advantage of this and take upwards of 30% of each monthly payment. This is absolutely unacceptable and is one reason why reading the fine print on a loans debt consolidation is absolutely necessary.Education loans are one reason people seek loans consolidation for debt relief. Taking out numerous education loans while in college can lead to several different interest rates, repayment rates, and an all around hassle for any student fresh from college. By consolidating these education loans into one lump payment, students are better able to repay their loans on time and avoid severe penalties and possible hits to their credit score.The Definition of Unsecured Consolidation LoansUnsecured consolidation is the most commonly used type of debt consolidation since it does not require any collateral to back the loan, such as a house or car. This type of loan typically comes with a variable interest rate and while it is good to consolidate your debts under the roof of one lender, you should be sure the amount of interest you are paying and the fees taken for such services do not over-burden you. Unsecured consolidation is best for those who do not have any collateral, or those who are not willing to risk their homes on getting out of debt for good.Other factors you need to consider include understanding how you managed to get yourself into debt in the first place. Education loans, massive credit card bills, high mortgages and car payments are all contributing factors to debt and some of them are unavoidable. However, speaking with a debt counselor about your current situation can better shed light on the choices made that have resulted in debt, and better allow you to understand how you can stay debt-free once you are out of debt.
After beating several other candidates, you have finally been accepted to the School of your dreams. Alas, because of circumstances outside your control you can’t gather the required economic assets to permit you to further your schooling. Your efforts to get a scholarship have come up short as a result of the intense competition for the small number of scholarships. At best, you have probably obtained a partial scholarship but still need to raise what’s left. At this point, it might be tempting to give up – however there is often a solution in the name of college education loans.Education will be a long-term investment decision – thus, you’d rather take a loan and pay later than miss a golden opportunity to better yourself. You will discover a variety of benefits that come with student loans. First, when compared to a standard loan, college education loans offer a better loan. College education loans have student friendly terms. Loan repayment will be postponed until you finish school. What’s more, the student will probably be given a grace period following graduation before they are required to start repayment. The repayment plan makes the loan much less strenuous on graduates who’ve just obtained an entrance level position that won’t pay that well.It’s also possible to defer your repayment. This is not only when you’re in school or before you obtain a steady source of revenue but also whenever you fall into fiscal hardships well into your job. When you postpone payment on federal college loans for these reasons, it will have no harmful impact on your credit score and you are not going to be subjected to penalties for non-payment. College education loans possess a lower interest rate than a normal consumer credit facility. College students who repay the loan on time may enjoy reduced rates.Another advantage of college education loans is they meet the criteria for government subsidy. Note though that this is just applicable for government sponsored college education loans – private loans don’t qualify for government subsidies. College loans also help build up your credit score. This is because taking the loan and servicing it consistently shows reliability and makes lending institutions more confident to loan to you after you join the job market or start a business. Applying for federal college student loans is not that complicated. Everything begins by filling out the FAFSA form (FAFSA stands for Free Application for Federal Student Aid).You need to do that (filling out the form) as soon as you can – if you do not have precise information for some of the information required, you’d rather use intelligent estimates then revise with a more exact number later. The data from FAFSA is needed to see just how much you or your parents would need to put in towards your college and what federal loan amount you’ll need. Schools also use the data in the FAFSA to determine who qualifies for their financial aid programs and by what amount.You should not miss out on your college education because of the shortage of financial resources. Apply for college student loans and begin to take the steps to a terrific future.
Student loan consolidation can provide financial relief to graduates carrying multiple college loans. Graduates can consolidate both federal and private education loans to reduce interest rates and monthly payment amounts.Most people use student loan consolidation to eliminate multiple payments. This can be particularly helpful for medical and law school graduates who often have six or more loans. Upon graduation, students must allocate funds to cover each installment as well as keep track of multiple payment dates. When post graduates submit late payments they are subjected to late fees and run the risk of damaging their credit rating.There are several factors to consider when consolidating college tuition loans. It is a good idea to conduct research or work with a financial consultant to weigh the pros and cons of college loan consolidation. The Internet can be a good source for understanding the intricacies of consolidating loans, as well as to shop and compare lenders.Students with both subsidized and unsubsidized loans will have different needs than graduates carrying one type of financing. Although subsidized and unsubsidized loans can be consolidated, lenders must consolidate the two using two separate loans in order to track payment transactions. However, borrowers will have one monthly payment and lenders contribute appropriate amounts to each account.Graduates must meet lending criteria in order to consolidate federal student loans. Eligibility criteria involves having an adequate FICO score; paying three loan payments in full; being current on all loan payments; and waiting six months from the date of graduation before applying for a consolidation loan.Post graduates with Sallie Mae financing must apply for consolidation loans through a conventional lender. At present, Sallie Mae is no longer participating in the federal loan consolidation program due to legislative cuts made by Congress.Students with Sallie Mae education loans can obtain counseling with a repayment specialist to find out which refinancing options exist. Student loan payment program details are provided at SallieMae.com.When borrowers consolidate education loans they must apply for a new loan to pay off outstanding student loans. Nearly all private and federal loans can be consolidated including: Perkins, Stafford, Direct, Guaranteed, and Health Professional.The U.S. government offers a sponsored student loan consolidation program for graduates who obtained financing through Direct Loans. This program is a good choice for students with bad credit because applicants are not required to undergo credit checks. Program details are provided at LoanConsolidation.ed.gov.Last, but not least, post graduates should research loan consolidation alternatives such as forbearance programs, tuition deferment, and student loan forgiveness. Debt forgiveness programs are available to graduates who hold degrees and obtain employment in public service fields such as education, medical and law. Loan consolidation alternatives are presented at CollegeScholarship.org.
What is the most popular type of student loan now? The Stafford loan. More than 90% of all money borrowed for college fall under the category of a Stafford loan. This loan was first started to help low income families be able to send their children to college. The perimeters for the loan were not overly confined when the program was instituted in 1965. Since them the perimeters have expanded to the point that this loan type is one of the Federal Education Loan Program options for many.The two different classes of Stafford loan, unsubsidized and subsidized, helped to extend its perimeters greatly since its inception.With a subsidized loan students do not begin repayment until the student completes his education. For all students maintaining at least a half time course schedule the government will pay all interest that accumulates on the loan. The interest payments do not become the responsibility of the student until after he completes his education.Families who desire this type of loan must first visit fafsa.ed.gov to complete a Free Application for Federal Student Aid (FAFSA). The FAFSA application will contain information to determine what the family’s financial status is. Subsidized federal loans are granted only to families with financial limits.These limits are not as great as you may think. Almost 10% of the Stafford loans granted were given to families who earnings were in 6 figures. However, for the most part Stafford loans are reserved for low income families. The large majority of these loans are granted to families whose income is less than $50,000 a year. As was mentioned earlier the perimeters are broad, but the loan program does benefit the needy.However, the perimeters do exist and not everyone will qualify. For students that cannot qualify for a subsidized loan an unsubsidized loan is an option. The Stafford loan that is unsubsidized means that you are still able to defer payments until six months after completely your education. However, during all of that time interest will accumulate and compound on the principal of the loan.It is difficult to illustrate how much interest will compound over the life of an unsubsidized Stafford loan. To know how much your loan will cost go to bankrate.com/brm/mortgage-calculator.asp. and fill in your loan terms to see exactly how much interest you will be required to pay.For the average student, there is a need to borrow between $10,000 and $20,000 to fund their education and these funds are generally obtained through a combination of loan types and programs.
Direct Loan is true to its name and self explanatory. It is a program in which the government loans money directly to students rather than using a third party bank or other lending institution to process and make the loan. The direct loan program has been in affect for about 15 years now.The opposite of a direct loan is a Federal Family Education Loan (FEEL). Both direct loan programs and FEEL programs make PLUS and Stafford loans available. There are other similarities between what each program offers. The borrower has to decide which type of program he wants.Since both offer the same types of loans the same requirements must be met. If it a loan offered based on a person’s credit scores then both direct and FEEL programs will have the same requirements. The same is true if the loan is based on a family’s income. Both programs will have to follow the same requirement guidelines in offering the loan. With so many similarities how does one choose?Well there are some differences to consider. One is in customer service. When you involve a third party that is in business to make money normally you get more of a personal touch. Also, because the lender will make no money if they are not able to extend you credit they will work harder to get you approved for the loan. Government agencies are normally not as personal or as accommodating.Go to talk.collegeconfidential.com/forumdisplay.php?f=7 if you want to hear what others think about the two different programs.Many things posted are solely personal opinion and not so much on the actual variables or requirements of each program. Reading through it may help you get a good idea of where you stand between the two options.One important factor to keep in mind is that whenever you are dealing with a private lender your loan is subject to be sold to another lending institution.The opposite is the case with direct loans which are always directly with the federal government. It if is important to you that throughout the life of your loan you are able to deal with the same person or group of people if you have questions or concerns you might want to consider going with a direct loan program.
Money is the quintessence of life and most of us pass through financial crunch at some point of time or the other. This is when we resort to loans. The soaring costs of higher education are forcing most of us to approach financial institutions. In such a scenario educational loans are gaining huge prominence. Sometimes people are even obliged to procure loans from more than one borrower in order to maintain a clean credit history. Off late federal loans have become very popular as they offer the best student consolidation loans. However, not everyone is able to enjoy the benefits of these federal loans. This is when private education loans come to our aid.Private education consolidation loans come with several unique features you can benefit from. Low and easy monthly installment payment is one of the unique features of these loans. The low monthly installments are mainly due to extension of loan repayment tenure.Loan interest rate is another lucrative feature of this loan. However, this benefit can be enjoyed over a period of time only by those borrowers with clean repayment history. The application process is also quite simple and loans can be obtained either by your own or by a guarantor with clean or sufficient repayment history. In case you have a clean track record, you stand every chance of getting loans at lower rates.In case you are availing this loan for pursuing medical or dental education, you have the option of rescheduling the loan up to forty eight months. This rescheduling period usually varies depending on the course you have opted. For instance: this period is three years for military personnel. If you like to pursue under graduation course then the maximum repayment tenor you can go for is twenty five years. On the other hand this tenor extends up to thirty years for graduate courses. The interesting aspect about these loans is that no prepayment penalty is charged at the time of closure.